Spanish auto sales fall for seventh straight month
New car sales in Spain posted a double-digit drop for a seventh straight month in January, a trade association said Tuesday, warning annual sales in 2011 will be below one million units for the third year running.
A total of 53,632 new cars were sold last month, a 23.5 percent drop over the same time last year when a government trade-in bonus scheme was still in place, auto manufacturers' association Anfac said in a statement.
"For the third consecutive year the Spanish market will record sales of less than one million units, far from its natural average which is between 1.3 and 1.4 million units," the statement said.
Car sales in Spain inched up 3.1 percent in 2010 over the previous year to to 982,015 units, after two years of declines, but the rise was fueled by strong sales during the first half when the government incentive programme still existed.
While sales were up 39.5 percent during the first half of the year, they have dropped by over 20 percent each month since the incentive programme ended in July and the sales tax rose by two percentage points that month.
Under the trade-in scheme introduced in May 2009, the government offered subsidies of up to 2,000 euros ($2,600) to help boost car sales. The programme expired when the money set aside for it was exhausted.
New car sales fell 17.9 percent in 2009 after dropping by 28 percent in 2008, its biggest-ever annual decline as the collapse of a property bubble plunged the country into its worst recession in decades.
With an unemployment rate of around 20 percent, the highest in the industrialised world, consumers have curbed spending, especially on big ticket items like cars.
The Spanish economy, Europe's fifth-largest, emerged from recession with tepid growth of just 0.1 percent in the first quarter of 2010 and 0.2 percent in the second, but then stalled with zero percent growth in the third.
© 2011 AFP